Archives for 2012
Rebalancing is an essential piece of the portfolio management process. Inherent differences among asset classes (e.g., stocks, bonds, and real estate) mean that the size and/or direction of their returns will likely differ over time. There may be periods of time where one asset is up, and one is down,
Human beings have an astounding ability for self-deception when it comes to our own money. We tend to rationalize our fears with logical sounding arguments. These arguments are often elaborate, short-term excuses used to justify behavior that runs counter to long-term interests. Below is a compilation of the five “greatest hits”
A passively managed index is often the most efficient equity portfolio an investor can employ. However, as Wall Street recognized the indexing boom as a business opportunity, investing in index funds has become far more complicated. Consequently, buyer beware—alternative indexes have been introduced and marketed as an improvement upon traditional
Recently, the Truepoint book club read The Behavior Gap: Simple Ways to Stop Doing Dumb Things with Money, by Carl Richards. In it, Richards coined the term “behavior gap” to explain the gap between investor returns and investment returns. What this means is that, in general, returns that investors have
Last December, my colleague, Courtney Weber, wrote the Viewpoint, “What is Wealth Management?” In it, Courtney stated that a successful wealth management experience ultimately leads to a long-term relationship between a client and his or her team of advisors. Truepoint works to develop long-term advisory relationships that are rooted in
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